In the United States, the economy has seen its fair share of growth and stagnation over the years. This is common for any growing economy. For low-income workers, this has meant instability in their finances, pushing them to venture into new ways of making money, one of them entrepreneurship.
Low-income workers have sought to entrepreneurship as a means of surviving the sharp economic pangs, and as a result, have provided new avenues of growth for the American economy.
Entrepreneurship has paved way out of poverty for these new entrepreneurs in a number of ways.
- Taking advantage of the Microcredit programs
Through entrepreneurship, many low-income households have been able to get out of the poverty hold in five years through microcredit programs. Microcredit programs are agendas set up by the US government to extend help in the form of small loans to new entrepreneurs.
According to the Aspen Institute research on microentrepreneurs that received these loans, more than half of them were able to get out of poverty within the first five years.
Their household assets also registered a significant growth during those years.
Entrepreneurship offers a higher economic return for low-income workers, allowing them to rise steadily from the low class to middle class and even higher for others. This is because unlike a salaried income, entrepreneurship has attractive economic opportunities that foster growth.
- Alternative to salaried wages
As a viable alternative to salaried wages, entrepreneurship has proved to be the best course of action for many low-income and middle -class workers. This has been especially true for immigrants, who comprise the highest number of low- and moderate-income (LMI).
Getting high level salary jobs for immigrants has continued to be a challenge for most of them. Thus, many turn to entrepreneurship and self-employment as a means to making ends meet. As the number of immigrants has continued to go high, so have their efforts to venture into entrepreneurship.
Due to this, immigrant entrepreneurs have fueled the increase of new businesses and development in the economies they venture in.
In doing this, immigrant entrepreneurs have been able to completely lift the economic face of some states like East Boston, Jamaica Plain, Allston Village, Houston and even New York City.
Through this, one can tell the significance that entrepreneurship holds, not only to high income individuals, but especially to low-income individuals as well in the road to eradicating poverty and moving up the economic ladder.
Pacific Research Institute–Breaking Down Barriers to Opportunity #2
Entrepreneurship as a Pathway to the American Dream